THE BANK OF NEW YORK,
New York, N.Y., August 30, 1974.

Re July 1974 CAB Study of Thirty Largest Stockholders of U.S. Certificated Air Carriers.

Hon. LEE METCALF,

Senate Committee on Government Operations,

Dirksen Senate Office Building, Washington, D.C.

DEAR SENATOR METCALF: Enclosed is a copy of a letter and attachment I have today sent to Mr. Ephie Kahn of the American Bankers Association. Also enclosed is a copy of the article in question.

While I have not studied the CAB survey and, therefore, am not prepared to comment on its contents, and neither should I if it serves the purposes for which it was intended to serve, I am constrained by my position to state that the lack of comment therein regarding investment authority and voting power can be misleading, notwithstanding your statement in connection with the survey as set forth in the July 25 Congressional Record regarding the absence in the survey of investment authority and voting power statistics.

The additional statistics relating to The Bank of New York's holdings should therefore be of interest to you. If it is possible to do so and you are not averse to such, I should think the additional statistics I have had developed might be related in some manner to the survey and also be reported in the Congressional Record.

If I can be of further assistance in this matter, please let me know.

Sincerely,

ALBERT L. Rapp, Vice President.

THE BANK OF NEW YORK,
New York, N.Y., August 30, 1974.

Re August 6 "Capital" Article-CAB Survey.
Mr. EPHIE KAHN,

Communications Department, American Bankers Association,
Washington, D.C.

DEAR MR. KAHN: You may recall our telephone conversation of about 10 days ago relative to the matter indicated above.

Subsequently, I obtained a copy of the survey and other material associated with it and had a review made of The Bank of New York's investment authority and voting power with respect to the shares held. The results of this further review are set forth in the attached draft of an article which I would appreciate your publishing in the next issue of "Capital".

While the earlier article was statistically correct, the absence of comments regarding investment authority and voting power can readily create impressions contrary to the facts. My sole purpose in pursuing the matter, therefore, is to endeavor to insure that readers are not misled as to the true position of The Bank of New York with respect to the airline shares it holds for customers' accounts in nominee name.

Thank you for your assistance in the matter.

Sincerely yours,

ALBERT L. RAPP, Vice President.

BANKS AND SECURITIES

The August 6 issue of Capital reported on the results of a survey conducted by the CAB of the nation's 38 airlines and indicated The Bank of New York is the largest holder of airline shares with a total of 12.9 million shares or 3.7% of all airline shares outstanding.

The survey, however, did not disclose the number or percentage to total shares outstanding of those shares with respect to which the holders had voting power and investment authority.

A further study by The Bank of New York based on the number of shares outstanding as of the report date reveals that while it held a total of 12.6 million shares (3.67% of shares outstanding) of the reported airlines as of August 23, 1974 in nominee names for customer accounts, it held investment and voting power over only approximately 275 and 228 thousands of shares, respectively, or less than .08% of total shares outstanding. The indicated totals and percentage of investment and voting power shares includes those accounts with respect to which the bank shares its' authority to make decisions and act with one or more co-fiduciaries.